London Daily

Focus on the big picture.
Wednesday, Aug 12, 2026

UK economy flatlines with no growth in February as strikes hit productivity

UK economy flatlines with no growth in February as strikes hit productivity

The lack of growth was unexpected - 0.1% had been forecast.

The UK economy flatlined in February, with no growth in GDP, according to official figures.

Civil service strikes and low energy consumption offset growth in areas such as construction - which grew 2.4%, the Office for National Statistics (ONS) data showed.

The flatlining was unexpected. Economists polled by the Reuters news agency had forecast slight growth of 0.1% for the month.

ONS figures showed services production fell by 0.1% in the month, following growth of 0.7% in January 2023.

The largest contributor to negative growth in the services industry was education, which fell 1.7% in a month where teacher strikes took place.

Another strikes hit sector, public administration, was the second largest contributor to negative growth in the services industry.

Construction grew thanks to repair works taking place and retail output increased as many shops had a "buoyant month", the ONS's director of economic statistics, Darren Morgan said.

Unseasonably mild and dry weather led to reduced production of electricity and gas, Mr Morgan added. Output in the arts, entertainment and recreation industries grew, however.

It followed growth of 0.4% in January and confirmation the UK economy avoided recession in the second half of 2022 and actually grew 0.1% in the final three months of the year.


The most recent projections from the independent economic forecaster, the Office for Budget Responsibility (OBR), said the UK will avoid recession - defined as two consecutive quarters of negative growth - in 2023, despite previous predictions.

But the economy will still shrink overall this year by an expected 0.2%, and the fiscal watchdog warned living standards are to fall by the largest amount since records began.

On a quarterly basis, the economy grew slightly. In the three months to February, the ONS said GDP, a measure of economic growth, increased by 0.1%.

However, responding to the flatlining, Chancellor Jeremy Hunt remained upbeat about the figures.

He said: "The economic outlook is looking brighter than expected - GDP grew in the three months to February and we are set to avoid recession thanks to the steps we have taken through a massive package of cost of living support for families and radical reforms to boost the jobs market and business investment."

But Labour's shadow chancellor Rachel Reeves criticised the government's record on economic growth.

She said: "Despite our enormous promise and potential as a country, Britain is still lagging behind on the global stage with growth on the floor.

"The reality of growth inching along is families worse off, high streets in decline and a weaker economy that leaves us vulnerable to shocks.

"These results are exactly why Labour's mission to secure the highest sustained growth in the G7 is so important - it's that level of ambition that we need to strengthen our economy, get our high streets thriving again and make families across every part of Britain better off."

The Bank of England's chief economist said the flatlining economy was "somewhat disappointing" but was still a significant improvement from its previous forecast of a recession.

Huw Pill, speaking at a panel event with Market News International Connect, said: "Last summer we were forecasting a pretty deep, and certainly a very prolonged, recession in the UK.

"Relative to that, the flatlining of the economy that we are seeing, in terms of the evolution of GDP, is a quite significant improvement."

Newsletter

Related Articles

0:00
0:00
Close
China’s Kimi Launches AI-Focused Credit Card With Agricultural Bank of China and American Express
Former Labour Adviser Arrested on Suspicion of Spying for China Held Privileged Access as Top Party Donor
Turkish Parliament Passes Landmark Bill Granting Conditional Amnesty to Disarmed PKK Members
Donald Trump Warns FIFA Against Ousting Gianni Infantino Amid Revolt by Global Football Leaders
Jeff Bezos Joins Investor Group Closing In on $6 Billion Liverpool FC Stake
Police Conduct Cross-Border Raids Against Northern England Drug Network
Nicola Sturgeon Protested at Edinburgh Festival Fringe Event
Major UK Retail Chain Enters Administration With One Hundred Fifty-Four Stores Set to Close
Heathrow Renews Call for Runway Expansion After Losing Europe’s Busiest Airport Ranking
Government Condemns One Million Pound Thames Water Executive Bonus Amid Drought
NHS England Says More Than One Hundred Thousand Hepatitis C Patients Have Been Cured
UK Foreign Secretary Ed Miliband Calls for End to West Bank Settler Violence
UK Prepares for Deepest Partial Solar Eclipse Since Nineteen Ninety-Nine
UK Heatwave Triggers Amber Health Alerts as Economic Losses Reach Four Point Four Billion Pounds
UK Offers Electricity Bill Discounts to Communities Hosting New Power Infrastructure
Bank of England Expected to Hold Interest Rates at Three Point Seven Five Percent
UK Government Moves to Ban Subscription Traps and Misleading Retail Discounts
Andy Burnham Gives Councils New Powers to Block Betting and Vape Shops
UK Councils to Receive Sweeping Planning Powers to Ban New Vape and Betting Shops
Nicola Sturgeon Says She Has No Contact With Estranged Husband After SNP Embezzlement Case
Police Arrest Two Men After Aberdeenshire Defense Technology Office Break-In
Greater Manchester Councils Gain Powers to Restrict New Vape and Betting Shops
Coroner Finds Treasury Workplace Failures Contributed to Personal Assistant’s Suicide
English and Welsh Courts Ban Meta Smart Glasses Over Recording and Privacy Risks
Strait of Hormuz Disruption Could Double UK Inflation and Trigger Recession, Forecasters Warn
UK Expands Global Talent Visa Scheme to Support Research-Intensive Companies
UK Equity Funds Suffer Record One Point Six Billion Pound Outflow Amid Capital Gains Tax Fears
Three-Quarters of England Enters Drought as Fifth Summer Heatwave Raises Economic Risks
UK Hiring Stabilizes for First Time Since 2022 as Employers Adjust to Higher Payroll Costs
UK Chancellor Orders Whitehall Spending Cuts as Public Debt Exceeds Three Trillion Pounds
UK Manufacturing Output Records Fourth Straight Month of Growth
UK Condemns Russian Torture of Ukrainian Prisoners and Recruitment of Foreign Nationals
Long-Lost Royal Navy Warship HMS Tiger Found in English Channel After 118 Years
Northern Ireland Finance Minister Seeks Urgent Treasury Talks Over Regional Budget Pressures
UK Government Targets Subscription Traps and Misleading Discounts in New Consumer Rules
Alleged Cartel Boss Daniel Kinahan Extradited From Dubai to Face Criminal Charges
AI Chatbots Challenge Traditional News Consumption and Raise Job Concerns
Andy Burnham Government Promises Crackdown on Exploitative Business Practices
UK University Funding Model Faces Growing Pressure From Unsustainable Student Debt
Government Urged to Subsidise Energy Bills for Vulnerable UK Households
UK Military Spending Plans Threaten to Deepen Infrastructure Funding Gap
Israeli Government Rejects US Peace Framework for Gaza
New Labour Government Signals Closer Economic and Strategic Ties With European Union
Amber Heat-Health Alerts Issued Across England as Temperatures Threaten 36 Degrees
UK Economy Expected to Grow Despite Energy and Supply Chain Shock From Iran Conflict
Foreign Social Media Accounts Drove Disinformation During Belfast and Southampton Riots
Record Number of Migrants Cross English Channel in Single Vessel as Smugglers Deploy Mega-Dinghies
Russia’s A7 Builds a State-Linked Payments Network Beyond Western Sanctions
Reports of Mark Zuckerberg-Linked Superyacht Declining Rescue Assistance Draw Maritime Scrutiny
Preserving Three Banksy Artworks in London Has Cost Taxpayers Nearly £150,000
×